-LRB- CNN -RRB- -- Investors of Russian assets have had their first real chance to assess the situation in Ukraine and they did n't like what they saw .

The two major indices in Moscow , the MICEX and the RTS , slumped more than 8 % on opening Monday and worsened as they day carried on . Investors do not like uncertainty and they were delivered more than their fair share over the weekend .

With the ruble hitting a record low of about 37 to the dollar , central bank governor Elvira Nabiullina surprised the market by pushing interest rates to 7 % to buffer a run on the currency .

The reality is quite simple : Russia 's economy has seen a dramatic slowdown for the past year . After growing 3.4 % in 2012 , it came in at about a third of that level last year with an expansion of just 1.3 % . The forecast of 2.5 % growth in 2014 , many suggest , looks ambitious with incursions into Ukraine part of the equation .

While this is being positioned domestically in Russia as a move by President Vladimir Putin on behalf of Russians in the east of Ukraine , the military action probably will not sit well with those in the middle class who took to the streets over the past year .

They have been frustrated by slow growth , a lack of transparency within government , and a lack of oil and gas revenues trickling down to those with higher aspirations and expectations .

During the height of the global financial crisis , Putin , whether at a G8 or G20 Summit , took the opportunity to criticize western powers for not being vigilant enough with their commercial bankers -- whether on Wall Street or within the City of London . He proudly predicted Russia would continue to grow at 4 % with ample reserves of a half trillion dollars saved for a rainy day .

That day may have arrived . Strategists I have interviewed complain that Putin relied on one asset -- energy -- for far too long .

At the World Energy Congress in South Korea late last year , the energy minister Alexander Novak spelled out plans for Russian reserves to expand handsomely over the coming years .

Gas pipelines , like the South Stream , are being constructed to bypass Ukraine and provide Europe with ample supplies for the next generation . Russia also has inked strategic energy partnerships with China and South Korea .

But as the world is finding out , one can not live on energy alone with an economy of 140 million people . Government ministers I have spoken with admit they are well behind the curve when it comes to infrastructure investment .

Another worrying sign for the economy is that it is expanding only modestly -- despite the projected $ 50 billion that was spent on the Sochi Winter Games and projects earmarked for the 2018 World Cup .

So where does dispute over Ukraine lead us ? There are a number of tricky questions that need to be answered .

Executives at Gazprom , Russia 's state-run gas giant , have declared that Ukraine is one and a half billion dollars in arrears on payments and that discounts given to the previous , pro-Moscow government expire at the end of the month . It is not clear whether Russia will turn off the taps as it has done twice before .

Ukraine is carrying an unmanageable amount of debt -- nearly $ 30 billion comes due by the end of 2015 , about half of that this year . The IMF is sending a team over for an initial consultation this week , but until the political situation is sorted out before elections , it is not clear whether the fund will step in .

There is a co-dependency between Russia and Europe . While major European Union members like Germany and France have reduced their reliance on Russian gas , about a quarter of all supplies still comes from pipelines filled by Moscow . About a third of Russia 's daily oil output of nearly ten million barrels a day goes to Europe as well .

Finally , the U.S. may be suffering from military fatigue after years in Iraq and Afghanistan and the European Union from expansion fatigue . With 28 members after of an era of enlargement and sluggish growth of just a 0.5 % projected for this year , Brussels can ill afford to jump into a political mess on its eastern flank .

Read more : Why Ukraine crisis matters to world economy

Watch more : Yulia Tymoshenko exclusive : Draft bill would annex Crimea from Ukraine

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Investors in Russian assets do n't like what they see in Ukraine , as CNN 's John Defterios explains

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Russia 's central bank governor has pushed up interest rates to 7 % to protect from a run on the currency

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Russia 's economy is expanding only modestly , despite huge expenditure on the Sochi Winter Olympics

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Huge questions still remain over the dispute in Ukraine and the global economic repercussions